For public goods,in general,the optimal output level is found where the marginal benefits of additional production equal marginal cost.

Question

Quizplus · Accepted Answer

This statement is true as the optimal output level of public goods is achieved when the marginal benefits of producing an additional unit of the good equals the marginal cost of producing that unit. This is because public goods are non-excludable and non-rival, which means that their consumption by one individual does not prevent others from consuming them and it is difficult to charge individuals for their use. Hence, the optimal level of production is where the total net benefit to society (benefits minus costs) is the highest, and this occurs where marginal benefits equal marginal costs.

For Public Goods,in General,the Optimal Output Level Is Found Where